Transforming the finance function

1
Transforming the
finance function
A Meet the Boss ebook, in partnership with Oracle

22
IN THIS EBOOK…
CHAPTER 1:
Challenges and drivers for change5
CHAPTER 2:
Implementation and opportunities for success10
CHAPTER 3:
Towards a modern finance function 15

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INTRODUCTION
Like many other functions within the organisation,
technology is proving something of a game-changer
for finance. Whether it’s greater use of cloud, data
analytics, robotics process automation or any of
the niche applications that are proving invaluable
to today’s finance teams, digital tools are improving
the efficiency of standard finance tasks such as
transactional processing, accounting and reporting.
But more importantly, they’re also starting to enable
finance teams to add real value to the business in the
form of better decision-making and insight.
Indeed, with unfettered access to critical financial and
operational data, and a bird’s eye view of both the
business and its position in the wider marketplace,
the modern CFO should be perfectly placed to help
navigate change and orchestrate transformation.
But with legacy systems, disconnected data sets
and entrenched organisational thinking to contend
with, transformation remains a tough proposition for
many. Identifying strategies to optimise your finance
structure, processes, people and technology to
increase efficiency and effectiveness remains a
key priority.

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So what does it take to evolve finance into an agile,
flexible and value-adding function? How does finance
harness digital tools and data to become a better
business partner? And where do the pitfalls lie?
Learning from those who’ve already taken those first
steps is an important starting point. Which is where
this ebook comes in.
Meet the Boss and Oracle recently hosted a series
of roundtables with senior executives from some of
the world’s leading brands to ask them about how
they are approaching finance transformation at their
respective firms. Each roundtable represented a
90-minute deep dive into the challenges they face
and the opportunities they see, led by the executives
themselves and independently moderated by Meet
the Boss.
This ebook gathers the highlights, challenges and
learning from those discussions: over six hours of
conversation with 20 senior executives on the impact
of, and drivers for, finance transformation. What does
business really think? It’s all here.
BEN THOMPSON, HEAD OF CONTENT, MEET THE BOSS

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CHAPTER 1
Challenges and drivers
for change
Finance wants to be a trusted business partner, and a key driver of
improved performance. But first, it needs to transform.
The finance function is changing. The
need to do more with the same (or in
some cases, fewer) resources remains a
significant challenge. The requirement
to respond more quickly to rapidly
shifting demands or market conditions
has increased. And the demand from
management and external stakeholders
for faster and more detailed information
to support better decision-making is
growing by the day.
For modern CFOs and their teams, the
need to transform is critical.
Yet change is easier said than done. A
significant number of organisations are
hampered in their efforts to deliver the
necessary speed, agility and insight
by a combination of cultural resistance
to change, and a reliance on legacy
systems and infrastructures.
“Existing finance systems are not well
placed to cope with future demands,”
complains Giuseppe Malanga, Director
of Finance and Business Operations at
pharma giant Roche. Werner Hoffmann,
CFO for the APAC region at multinational
lighting firm Osram, agrees. “As it stands
we lack the flexibility in our systems to
adjust to the new business models that
are coming,” he says.

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It’s a common concern.
“We’re dealing with
a myriad of different
systems that have been
implemented over time,”
explains Sondra Curtis,
CFO for APAC at financial
service firm Westpac.
“Trying to consolidate
those to create uniform,
streamlined, efficient
reporting is a real
challenge.”
So how do you effectively
deal with what you’ve
inherited from the
past? “We are trying to
eradicate legacy systems
as much as possible,”
“Irrespective of the industry, 95
percent of the challenges finance
teams face are the same.”
DARYL SZEBESTA, VP FOR CLOUD TRANSFORMATION, ORACLE
says Brigitte Lawler
Head of the Finance
Transformation Program
at SGS. “But some of them
are intricately woven into
the fabric of the business,
so the implications can
be quite scary. It takes
time to unravel some
of the things that have
become part of our way of
operating.”
And if that sounds like
your organisation, take
heart: you are not alone.
“Irrespective of the
industry, 95 percent of
the challenges finance
teams face are the
same,” suggests Daryl
Szebesta, VP for Cloud
Transformation at Oracle.
“How do I address this
huge amount of data?
How do I take value out
of it? How do I drive
insight rather than
looking over my shoulder
at historic trends? And
how do I move quickly
and do it in a world where
we’ve all grown up with
lots of fragmentation,
customisation, etc? Those
are the key challenges for
today’s CFO.”

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4300%
increase in annual data
production by 2020
Indeed, making sense of
the vast swathes of data
companies are collecting
is fast becoming the
number one concern
for organisations across
every industry vertical.
And the problem is only
going to intensify. Experts
are predicting a 4300
percent increase in annual
data production by 2020,
while systems sprawl,
increased complexity of
the environment and a
lack of standardisation are
only adding to the data
management challenge.
For finance teams, as for
other functions, the chief
challenge is translating
that information into
actionable insight. “I
don’t think we’re short
on data, but what
we’re not so good at
as a finance function is
taking that data, pulling
out key insights and
driving actions,” admits
Claire Binmore, Chief
Performance Officer
at Aviva.
“We need to manage
our data better,” adds
Bill Low, VP Finance at
Oakwood Asia Pacific.
“As a CFO, if we see a
trend or movement in the
market, we can’t wait until
the end of the month to
report on it. We should be
prompting the board to
act in real-time, and for
that to happen we need
information.”

More specifically, you need joined-up information. The
Holy Grail for most firms is having a single source of
the truth – but the reality is often very different. “The
real challenge is when you have to start incorporating
data that sits outside the finance organisation,”
suggests Femi Adebayo, Director of Commercial
Finance at 9mobile, formerly known as Etisalat Nigeria.
“It might be sat in siloes. You might not even really
know that data exists.” Sameer Altaf, CFO at Batelco,
agrees. “If you don’t manage and have discipline
around the flow of information, then it can take you in
the wrong direction,” he says. “You need one version of
the truth.”
And therein lies the key driver for change: becoming
a true business partner that adds real value and
insight into areas for improvement, emerging trends
and competitive threats. Facilitating closer finance
and operations alignment – getting operational
plans, models and KPIs aligned to financial goals and
measurements, with clearer trigger points for action
– is a common driver behind many organisations’
finance modernisation efforts. And being able to drive
performance, rather than merely report on it, is now a
key finance goal.
“The real challenge is when
you have to start incorporating
data that sits outside the
finance organisation.”
FEMI ADEBAYO, DIRECTOR OF COMMERCIAL FINANCE, 9MOBILE
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Enis Yazirilioglu, Head of Business Model
Transformation at mobile operator Turkcell, sees
transformation as the logical response to a world
that is rapidly changing. “Our revenue models, our
profitability measures are changing,” he says. “Our
customers want to reach content. They want to be
socialised. They want to be engaged on different
platforms. So our business models and finance
systems are transforming together.”
9mobile’s Adebayo sees a similar shift. “Customer
behaviour is changing fast. And technology is
also changing fast. We have to be able to get the
information from operations as quickly as possible
into our database, and to be able to use that to make
informed business decisions.”
The challenge, says Szebesta, is how you use that
massive amount of data to derive insight for the
business. “It’s a massive opportunity,” he says.
“Finding the right tools is essential.”

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CHAPTER 2
Implementation and
opportunities for success
Change is coming. So how are some of the world’s leading
organisations approaching their own transformation journeys?
Without doubt, expectations on the
finance organisation are changing.
Finance is moving away from a pure
reporting role, towards more decision
support, predictive analysis, and greater
responsibility for managing the overall
performance of the organisation. And
successfully navigating that change
journey is critical to the long-term health
of the business.
As ever, the first step for any
transformation project is getting buy-in.
“Having a very active and empowered
business sponsor is key,” says Oracle’s
Daryl Szebesta. “You also need a strong
partnership between the CFO and
CIO, where you prioritise based on
business needs.”
Christian Baltzer, Group CFO at Tryg
Insurance, agrees – but also highlights
the importance of having the right
organisational structures in place. “With
the right structure and the right focus
from leadership, you can do this on a
large scale,” he says. “Saying ‘Oh, we’re
big and complex, we can’t do it,’ is just
an excuse. If you’re big and complex you
need to figure out how to get a better
structure so it doesn’t feel so big
and complex.”

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Indeed, taking a wider
organisational view is a
critical part of any finance
transformation initiative,
given how central the
function is to much of
the rest of the business.
“It really requires cross-
functional collaboration,
because much of the data
that we use in finance
does not originate there,”
says Tom Bloemers, Head
of Finance Transformation
at Philips. “For instance,
an invoice is not, in most
cases, initiated from
finance. Finance is a
touchpoint for it and has
some responsibility. But
it originates somewhere
else. That’s why board-
level buy-in is key.”
Once you have the
sponsorship, it’s time to
get your priorities straight
with regards to what
you want to tackle first,
and which solutions can
potentially help.
“Every investment you
make, there has to be
a return,” maintains
Manikantan Thyagarajan,
SVP for Finance
Operations at Mphasis.
“Whenever you go for a
new solution, you look at
the cost benefit analysis.
You need to have both the
CIO and finance function
discussing it together.”
“It really requires cross-functional
collaboration, because much of
the data that we use in finance
does not originate there.”
TOM BLOEMERS, HEAD OF FINANCE TRANSFORMATION, PHILIPS

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“It’s absolutely about prioritisation and cost allocation
and value for money,” agrees Sondra Curtis, CFO at
Westpac. “Often, upgrading the finance systems isn’t
the number one priority on the investment list when
there are sexier projects the business wants to pursue.
It’s about finding a balance between getting sufficient
insight, without spending a lot of money on something
that is quickly redundant in a rapidly changing
technology space.”
For Szebesta, avoiding such an outcome is about
identifying the key business challenge you’re trying
to solve. “You need to define what it is you’re trying
to do as a business before you spend any money on
technology or use any resources, because you could
quite easily end up with what you have now but in a
shinier box,” he says. “You might spend a lot of money
to achieve not a lot of change.”

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That prioritisation also has to extend to the data,
too. “The user has got to understand what data is
useful to them,” argues Bill Low, VP of Finance at
Oakwood Asia Pacific. More importantly, the ability to
draw meaningful conclusions from that information is
essential. “Figures are useless if you don’t analyse, you
don’t compare, you don’t show a trend,” he continues.
“To me, a figure is only useful when it can tell you a
story. If you are unable to tell a story I think it’s a waste
of time.”
And this is where advanced analytics comes in. Going
beyond typical spreadsheet reporting to embrace
emerging technologies such as machine learning,
natural language processing, optimisation and
predictive analysis provides CFOs with a suite of tools
that can broaden their view and help them guide
strategic business decision-making – and tell that story
more effectively.
“Analytics allows you to look into the data you
have and really explore further opportunities,” explains
Bloemers. What’s more, such tools are freeing up
finance teams to add real business value. “I think we
are now starting to see finance people who act more
like financial scientists. On the one hand they are
financial analysts, with a good financial grounding; but
at the same time they are also data experts
who can provide combined technology data and
finance insights.”

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And for that to be
successful, examining
your entire approach
to data management is
critical. As Mahadevan
Natarajan, Senior Director
for ERP EPM at Oracle,
puts it: “The trend I see
now is to move away
from creating islands of
data. Instead, leading
firms are looking at
how to create a unified
data model that can
interoperate depending
on the business outcome
you’re driving towards.
How can I solve planning
and budgeting? How can
I solve my profitability?
How can I solve my
financial consolidation?”
Leveraging the deep
and broad data that
companies possess and
turning it into actionable
intelligence is the key to
driving a host of different
business outcomes,
such as better customer
engagement, improved
experiences, and
increased revenue for the
enterprise. And finance
organisations are often
the custodians of much of
that data.
“You still need to do
the mundane tasks like
reporting, analysis, and
closing, etc. But that is
where technology can
help you in automating
those repetitive tasks,
giving additional time for
you and your team to
think more strategically,”
confirms Natarajan. “The
CFO definitely has a
bigger role to play.”

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CHAPTER 3
Towards a modern
finance function
In the face of digital disruption, emerging competition and shifting
markets, finance is changing too. So what does that mean for the
CFO role?
As technology continues to impact
the speed at which business operates,
the ability to respond to the rapid
pace of change has become a critical
organisational characteristic. Agility,
flexibility, speed – all are essential in
order to react to emerging competitive
threats, new technology trends and
shifting customer demands.
And as the business transforms, so
must the CFO. Recent Oracle research
found that nearly 40% of finance leaders
see the finance department becoming
more accountable for the success of
the business, while 45% admit they
are under increased pressure to raise
productivity. Perhaps the biggest
surprise there is that those numbers
aren’t higher.
Osram’s Werner Hoffman agrees that
the nature of the finance role has
shifted from merely reporting what has
happened to defining what might come
next. “The CFO is not just about the
numbers; it’s about how we drive the
transformation process,” he explains.
“It’s no longer just about explaining the
past, it’s more about shaping the future.
What kind of business model should
we adopt? How should we change the
company? What about culture and
values? It’s about finding our role in
the transformation process, and giving
the organisation the right financial
perspective on how to transform.”

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For Agnes Lim, CFO at Jones Lang
Lasalle, that transformational element
is key. “It requires you to be a strong
change agent in changing the way the
business works, as well as a finance
person able to measure how things
are being done efficiently or return on
capital,” she says. “You need the ability
to tell a story, be good with figures and
use technology. It’s a skillset that is not
commonly found.”
As such, developing strong relationships
with other departments – particularly
IT – will be critical. In that same Oracle
study, 73% of finance leaders said
73%of finance leaders said that
closer CIO/CFO alignment has
become critical to achieving
finance transformation.
that closer CIO/CFO alignment has
become critical to achieving finance
transformation. And for many, it is
finance, rather than IT, that needs to take
the lead.
“IT is the custodian of what is already
there, and as such is not really in the best
place to drive technological evolution,”
explains Mirko Dierks, CFO at Zuellig.
“It’s now the role of the CFO to question
business models, checking where we make
money, where we don’t make money, and
what technology is out there to help us to
drive the business forward.”

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Oracle’s Maha Natarajan takes a similar
view. “I see the CFO role as more of a
strategic thinker role, bringing the CIO
and the CHRO into the room to discuss
the systems and processes and skillsets
that will be needed going forward,”
he says. “Where is our competition
moving? Will our systems and processes
and skillsets have to change? And how
do we go about that transformation
journey and ensure that all these pieces
are knitted together? This is where I
see CFOs taking a much more active,
leadership role.”
And with CFOs increasingly accountable
for the performance of the business,
having that insight and analytical ability
will be key. “It comes down to the pace
of change, whether it’s volatility in your
marketplace, whether it’s disrupters
entering your industry, or something
else,” says Westpac CFO Sondra
Curtis. “We’ve got to be reacting and
responding so much more quickly than
we have done in the past.”
“We’ve got to be reacting
and responding so much
more quickly than we have
done in the past.”
ONDRA CURTIS, CFO, WESTPAC

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Finance transformation – like any change journey –
is hard work. And with many organsations having
experienced mixed success with transformation in
the past, how you sell the concept in to the business
is critical to the ultimate success of your project.
Perceptions matter.
“There’s a lot of legacy and a degree of negativity
around the word ‘transformation’ because we’ve
tried it multiple times before and it tended to fail,”
admits Clare Binmore, Chief Performance Officer at
Aviva. “Our transformation journey is as much about
cultural change for our people as it is for finance
processing systems.”
For Oracle’s Daryl Szebesta, success is about providing
value to the finance community at the earliest stage
possible. “We limit the amount of time we spend on
any single part of the transformation, in order to avoid
transformation fatigue,” he explains. “The biggest
challenge is convincing everyone who has been very
comfortable with the way they’ve done things in the
past that they need to change – whether that’s the
business, the IT department, finance or whoever. The
technology aspects are relatively simple to solve.”

191919
But despite the hurdles and the challenges,
transformation remains an essential next step for
any firm looking to succeed long-term. “For me, it
goes beyond a business case,” argues Hoffmann.
“Sometimes you just know what direction you need
to take. You can do all the calculations, but you will
come back to one fact: you need to change your
business model in order to be able to react to the
market, to compete. If competitors have these
kinds of data models and you’re still relying on Excel
models with very limited options, you will fall behind.
Transformation is about survival.”
Analyst, storyteller, advisor, technologist, change
agent, leader: as demands and expectations on the
finance function continue to rise, the modern CFO
must wear many different hats and develop a range
of new skills. Ensuring business performance is now a
finance imperative. And for that, transformation
is essential.
“Transformation
is about survival.”WERNER HOFFMANN, CFO ASIA PACIFIC REGION, OSRAM

202020
What have we learned?
Oracle’s Daryl Szebesta offers his top tips for finance
transformation success.
FIND THE BUY-IN
From top to bottom, getting the organisation on-
board with change is critical. Win friends – but
make sure you dictate the pace. “There’s often a
lot of cultural resistance, and you can spend a lot
of time trying to persuade people. It needs to be a
collaborative endeavour. But ultimately you need
to get the CFO to enforce change.”
DEFINE PRIORITIES
Transformation is essential, but what does it mean
for your business, specifically? Know what you
want to achieve, and plan accordingly. “There are
two aspects to transformation,” says Szebesta.
“Does it have business value, and does it have
employee value? Both of those things need to be
stakes in the ground to control the priorities.”
BECOME DATA-DRIVEN
Forget the past; historical reporting is so last
decade. Instead, think about how your data can
predict trends, mitigate risk and inform your future
direction. “The challenge is how to use the massive
amount of data that’s generated to derive insight
for the business. Thanks to the tools that are now
available, that is also a massive opportunity.”

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FORGE PARTNERSHIPS
Remember: you are not alone. Think of it
not as finance transformation, but business
transformation – and collaborate with your peers.
“The challenge for any individual in a business
is their ability to link to the overall imperative.
IT is an enabler of business performance – so
the relationship between the CFO and the CIO is
fundamental.”
CONSIDER THE CLOUD
“The advent of cloud and what it offers in terms
of the ability to be simple, standardised and agile
really helps in terms of speed of business and
speed of transformation,” says Szebesta. Cloud
won’t solve all your business challenges – but it will
help you roll things out much quicker, and respond
faster to shifts in the environment.
IN ASSOSIATION WITH
www.oracle.com

Transforming the finance function

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